U.S. sales of light vehicles slipped 4 percent last month as automakers were dragged down by a quirk in the industry's reporting schedule and signs of skittish consumers.
Ford Motor Co. and Chrysler Group were the only major automakers in the winners column, where they were joined by Subaru, BMW Group and Jaguar Land Rover. Sales fell at General Motors, Toyota Motor Corp., Honda Motor Co., Nissan Motor Co. and the Hyundai-Kia Group.
The seasonally adjusted sales rate -- a broad measure of the industry's health -- rose to 15.3 million units last month from 14.8 million in September 2012. Still, it was the weakest SAAR reading since April's 15.2 million rate.
The results were in line with analysts' forecasts for the first monthly decline in U.S. demand since May 2011.
The dropoff was attributed primarily to a calendar oddity that counted Labor Day holiday weekend sales in August. But some automakers said they also detected pockets of consumer jitters.
"We definitely felt a market pullback during the month of September," said Dave Zuchowski, executive vice president of national sales for Hyundai, where sales dropped 8 percent last month.
"A shorter selling month certainly contributed to this softening but waning consumer confidence influenced by concerns about a potential government shutdown and uncertainty over out-of-pocket health care costs, associated with the launch of the Affordable Care Act, were likely causal factors as well," he said.
Several analysts suggested some automakers were also hurt by low inventories on some models after robust August sales. September's results came on the heels of a 16.1 million SAAR in August, the industry's strongest performance since late 2007.
Still on track
Even with the September setback, analysts and automakers believe the industry remains on pace to post the largest annual sales total this year since the recession.
The SAAR has now topped 15 million units every month beginning with November 2012.
"September was a solid month for the auto industry despite two fewer selling days," said Bill Fay, group vice president and general manager of the Toyota division, where sales dipped 3 percent last month. "Industry fundamentals are strong as interest rates stay low and consumers remain confident."
Ford's sales rose 6 percent and Chrysler was up 1 percent, extending its streak of consecutive monthly gains to 42. Toyota Motor Sales fell 4 percent, Nissan was down 6 percent, Honda slipped 10 percent, and GM dropped 11 percent while outselling rival Ford by only 2,743 light vehicles.
GM's September skid marked its first drop since July 2012, with Chevrolet volume down 15 percent and GMC off 10 percent. Deliveries rose 7 percent at Buick and 10 percent at Cadillac.
GM officials blamed the decline on a 6 percent drop in retail volume and a 27 percent decrease in fleet shipments. Sales of GM's big pickups also dropped.
GM also cited a drop in the timing of fleet deliveries and the fact that September had two fewer selling days than it did last year.
"We held our own when it comes to retail market share this month thanks to strong new products," said Kurt McNeil, head of U.S. sales operations for GM.
"As we look toward the fourth quarter, we expect that car-buying fundamentals will remain strong," McNeil added. He cited falling jobless claims, continued low interest rates, a recovering housing market and low energy costs.
Ford said deliveries rose to 184,452 units, with sales at the Ford division climbing 6 percent.
Demand slipped 5 percent at Lincoln. Ford's car sales rose 14 percent, fueled by robust deliveries of the Fusion and Fiesta.
F-series pickup volume, helped by incentives up to $5,000 or more in some markets, jumped 10 percent to 60,456, marking the fifth consecutive month sales have topped 60,000 units.
Ford benefited from a 15 percent spike in the average incentive it offered last month, TrueCar.com estimated.
Toyota's 4 percent decline left it with sales of 164,457 last month, the company said.
At Honda, sales at the Honda division slipped 9 percent while Acura volume dropped 19 percent. Demand for Honda's four core models was mixed, with sales of the Civic compact and CR-V crossover rising, but Accord and Odyssey minivan posting a drop in deliveries.
"Even as we catch our breath from all-time record August sales and with two fewer selling days this month, the Honda brand continues on a strong pace for the year," John Mendel, executive vice president of sales at American Honda, said in a statement.
Chrysler's 1 percent gain came from a 3 percent advance in car deliveries. Light-truck volume was flat.
Sales rose 8 percent at Ram, 3 percent at Dodge and 2 percent at the Chrysler brand. But volume slumped 24 percent at Fiat and 5 percent at Jeep.
Deliveries of the Ram pickup -- one of Chrysler's most profitable vehicles and a top volume performer in a hot segment this year -- rose 8 percent to 28,145 units last month.
Sales at Jeep are off 3 percent this year and continue to be hampered by the discontinuation of the Jeep Liberty in 2012 and the delayed launch of its replacement, the 2014 Cherokee.
Chrysler planned to begin selling the new Cherokee in the third quarter but software glitches have forced the company to postpone dealer shipments.
"Our dealers had two less selling days in September compared with a year ago, but they still outperformed the industry," Reid Bigland, head of U.S. sales for Chrysler Group, said in a statement.
At Nissan Motor, Nissan brand volume was off 6 percent and Infiniti sales were down 4 percent.
Among other automakers, U.S. sales last month rose 15 percent at Subaru, 1 percent at Jaguar Land Rover and 13 percent at Porsche. Mitsubishi Motors North America said September sales slid 17 percent to 4,001 units.
Rich Carpenter, new-vehicle sales manager at Gunn Chevrolet in San Antonio, described September as "tough."
"Labor Day is always big for sales, but September is always just a tough month," Carpenter said before today's results were released. "We're hoping to see a strong October."
At Findlay North Volkswagen in Las Vegas, September proved to be an average month despite zero percent financing on 72 month loans on many models. Dealership officials are banking on 2014 models to jumpstart sales.
"We've been, on average, increasing sales around 30 percent a month and September was down slightly from last year. But with the new models coming out ... October should be right on track to get to our 30 percent mark," said Jeff Nabel, general sales manager at the store.
It's unclear what impact the budget impasse in Washington and the partial government shutdown will have on the broader U.S. economy and the auto industry's outlook.
"We're all concerned," Ken Czubay, head of U.S. marketing, sales and service at Ford, told reporters today on a conference call. "We're going to have to evaluate how long it's going to last, and we'll take the appropriate measures depending on the length of the activity in Washington."
Traffic dips in D.C.
But Volkswagen Group of America, which is based in the Washington, D.C. suburbs, is already seeing the effects of the government shutdown in areas with an outsized number of federal employees.
Mark McNabb, COO at Volkswagen of America, said he visited a few dealerships near the company's headquarters this weekend; traffic was lower than usual.
"There's roughly 800,000 government employees that could be furloughed," he said. "You know, at some point in time, it will have an impact."
U.S. sales declined 12 percent in September at the VW brand. Just two VW nameplates -- the Beetle and the Tiguan crossover -- sold better than the previous September. Sales of the Jetta and Passat sedans, the brand's best sellers, were down 9 percent and 17 percent, respectively.
Sister brand Audi posted a 6 percent sales increase. The A4 model line returned to its historic position as Audi's best seller with a surprising 29 percent jump in sales, but the Q5 model line also stayed hot with a 45 percent increase. It accounts for 25 percent of Audi's sales this year while the A4 accounts for 24 percent.
GM's McNeil said the government shutdown should not affect sales in the short term, but "if the thing drags out a couple weeks," then "it starts to more impact customer sentiment and starts to have a bigger factor on business."
"But right now, short term, we still feel better about all the other, positive economic factors," McNeil added.
Confidence among U.S. consumers fell to a five-month low in September on fears of higher interest rates and sluggish economic growth, according to a closely watched University of Michigan study. Gains in hiring and household income remain tepid. And there are early signs the holiday shopping season will be flat for many retailers.
Business confidence has dipped, as well. In a survey by the Business Roundtable, a trade group for big-company CEOs, half of top executives said the budget fight in Washington was crimping their hiring plans.
U.S. auto sales have now climbed 8 percent this year and remain a bright spot in the economy, with consumers taking advantage of low financing offers, subsidized leases and other deals to replace aging cars, crossovers and minivans.
"September sales may see some modest headwinds from slightly weaker consumer confidence and uncertainty around the federal debt situation, but declining gasoline prices should be favorable for mix," Jefferies LLC analyst Elaine Kwei said last week. "Underlying fundamental demand drivers remain in place: consumer confidence is relatively high, unemployment ticked down to 7.3 percent in August, and we continue to see increases in home prices and construction activity."
Gabe Nelson, Mike Colias, Joseph Lichterman and Sean Gagnier contributed to this report.